SG: MARKET PULSE: Wilmar, ART, First REIT, StarHill REIT, Ezion, Raffles Med, Triyards (28 Oct 2013)

Stock Name: Wilmar
Company Name: WILMAR INTERNATIONAL LIMITED

Research House: OCBC

Price Call: HOLD

Target Price: 3.33

Stock Name: AscottREIT
Company Name: ASCOTT RESIDENCE TRUST

Research House: OCBC

Price Call: BUY

Target Price: 1.39

Stock Name: First REIT
Company Name: FIRST REAL ESTATE INV TRUST

Research House: OCBC

Price Call: BUY

Target Price: 1.18

Stock Name: Starhill Gbl
Company Name: STARHILL GLOBAL REIT

Research House: OCBC

Price Call: BUY

Target Price: 0.95

Stock Name: EzionHldg
Company Name: EZION HOLDINGS LIMITED

Research House: OCBC

Price Call: BUY

Target Price: 2.90

Stock Name: RafflesMG
Company Name: RAFFLES MEDICAL GROUP LTD

Research House: OCBC

Price Call: BUY

Target Price: 3.61

Stock Name: Triyards
Company Name: TRIYARDS HOLDINGS LIMITED

Research House: OCBC

Price Call: BUY

Target Price: 0.88

MARKET PULSE: Wilmar, ART, First REIT, StarHill REIT, Ezion, Raffles Med, Triyards

28 Oct 2013

KEY IDEA Wilmar: Downgrade to HOLD on valuation Summary: Wilmar International Limited's (WIL) share price has done very well since we upgraded our rating to Buy on 6 Sep, rising as much as 14% to a recent high of S$3.50. As the current price is also 4% above our S$3.33 fair value (still based on 12.5x blended FY13/FY14F EPS), we downgrade our call to HOLD on valuation grounds. We also do not see any strong near-term catalysts to justify a re-rating before its 3Q13 results due 7 Nov. (Carey Wong) MORE REPORTS Ascott Residence Trust: 3Q13 ahead of expectations Summary: ART announced 3Q13 results that were ahead of ours and the street's expectations. Revenue climbed 11% YoY to S$86.1m, chiefly due to additional revenue of S$14.1m from the properties acquired in second half last year and on 28 Jun 2013. The increase was partially offset by the decrease in revenue of S$4.7m from the divestment of Somerset Grand Cairnhill in Sep 2012 and lower contribution of S$0.7m from the existing properties, mainly properties in Philippines and Japan. The group achieved a RevPAU of S$133 in 3Q13, a decrease of 10% as compared to 3Q12. The decrease in RevPAU was mainly due to divestment of Somerset Grand Cairnhill Singapore and weaker performance from Philippines and Japan. Gross profit climbed 10% YoY to S$44.8m. Unitholders' distribution increased 17% YoY to S$30.0m. DPU rose 6% YoY to 2.37 S cents, bringing 9M13 DPU to 7.07 S cents, versus full year estimates of ours and the street of 8.9 S cents and 9.0 S cents respectively. Adjusting our assumptions, our FY13F DPU forecast increases from 8.9 S cents to 9.1 S cents and our FV increases to S$1.39 from S$1.37. We maintain our BUY rating on ART. (Sarah Ong) First REIT: 3Q13 DPU below expectations Summary: First REIT (FREIT) reported 3Q13 revenue of S$22.8m and DPU of S$0.0196, representing an increase of 60.7% and 16.7% YoY, respectively. For 9M13, revenue jumped 43.1% to S$60.4m and was within our expectations. However, DPU of S$0.0555 (+14.2% after excluding exceptional distributions) was below due to higher-than-estimated expenses. Looking ahead, FREIT will continue to seek opportunities at expanding its footprint in Indonesia, given her growing healthcare market and the strong pipeline of possible acquisition targets from its sponsor Lippo Karawaci. We maintain our revenue estimates but tweak our DPU forecasts for FY13 and FY14 downwards by 4.4% and 1.9%, respectively. This correspondingly lowers our DDM-derived fair value estimate from S$1.20 to S$1.18. Given a decent FY14F dividend yield of 7.5%, we maintain our BUY rating for FREIT. (Wong Teck Ching Andy) Starhill Global REIT: Delivering as promised Summary: Starhill Global REIT (SGREIT) reported 3Q13 DPU 1.21 S cents, up 9.0% YoY. This brings the 9M13 DPU to 3.77 S cents, in line with our expectations. SGREIT's Singapore portfolio continued to benefit from Wisma Atria (WA) redevelopment and upward rent reviews at Ngee Ann City (NAC). For its overseas properties, Australia portfolio was the key performer, raking up a 25.7% increase in NPI due to incremental income from Plaza Arcade. This more than offset the lower contributions from the other overseas properties due to unfavourable forex movements and increased competition. On the capital management front, we note that SGREIT has completed the drawdown of new unsecured loan facilities to refinance its debts due in 2013, leaving it with no refinancing needs until Jun 2015. As at 30 Sep, gearing stood largely unchanged at 30.6%, while the fixed/hedged debt ratio improved to 94.0% from 81.0% seen in 2Q. We maintain BUY and S$0.95 fair value on SGREIT as we continue to like its clear growth drivers, robust financial standing and compelling valuation. (Kevin Tan) Ezion Holdings: Secures US$65m LOI for service rig Summary: Ezion Holdings announced this morning that it has received a letter of intent with a contract value of up to about US$65m over a three-year period to provide a service rig for an oil major to support its oil & gas activities in SE Asia. The unit is expected to be deployed by late 3Q15, and will be funded through internal resources and borrowings, like Ezion's earlier projects. The group is in the process of forming a JV to order and own an additional service rig in conjunction with this project, and pending more details from management, we maintain our BUY rating and fair value estimate of S$2.90 on the stock. (Low Pei Han) Raffles Medical Group: 3Q13 results in-line with expectations Summary: Raffles Medical Group (RMG) reported its 3Q13 results this morning which were within our expectations. Revenue rose 8.0% YoY to S$85.1m. PATMI was up 10.3% to S$13.9m. Growth during the quarter was driven largely by a higher patient load. Both of RMG's core divisions contributed to its topline increase, with its Hospital Services and Healthcare Services segments growing 9.4% and 5.7% YoY, respectively. For 9M13, revenue and PATMI increased 10.7% and 14.0% to S$253.0m and S$41.7m, forming 72.8% and 68.7% of our full-year estimates, respectively. 4Q is traditionally RMG's strongest quarter and we expect this trend to continue in FY13. We will provide more details after the analyst briefing. Maintain BUY and S$3.61 fair value estimate. (Wong Teck Ching Andy) Triyards Holdings: Secures contracts worth US$59m Summary: Triyards Holdings announced this morning that it has secured two contracts worth US$59m, including its 10th Self-Elevating Unit (SEU) order. The SEU order is with an Asian-based client and is for TRIYARDS' BH 335, which has a leg length of more than 100m (~335ft). The other contract is for the construction of a turret for a Floating Storage Offloading (FSO) unit in Indonesia. As at 31 Aug 2013, the group's net order book stood at US$217m. Pending more details such as the delivery date of the SEU, we maintain our BUY rating with S$0.88 fair value estimate on the stock. (Low Pei Han)

For more information on the above, visit www.ocbcresearch.comfor the detailed report.

NEWS HEADLINES

- US stocks finished another week of gains with the S&P 500 index at a record high after earnings from large technology companies wowed investors with revenue growth. - Singapore's industrial production for Sep outstripped even the most bullish of market forecasts to grow 9.3% from a year ago. - Property consultants have given mixed reactions to the latest 3Q13 private housing data released by the Urban Redevelopment Authority. - Fraser and Neave's move to shed its property arm and focus on its other core businesses took a step forward after Frasers Centrepoint Limited got the go-ahead for its planned listing. - The units of three local firms - Tat Hong Holdings, Boustead Singapore and CSC Holdings - have set up a joint venture with AME Group to develop land in Iskandar Malaysia.

OSPL - Good Morning S'pore - Central Dealing Desk

Stock Name: Starhill Gbl
Company Name: STARHILL GLOBAL REIT

Research House: UOB KayHian

Price Call: BUY

Target Price: 0.93

Stock Name: Genting SP
Company Name: GENTING SINGAPORE PLC

Research House: Nomura

Price Call: HOLD

Target Price: 1.52

Stock Name: Yangzijiang
Company Name: YANGZIJIANG SHIPBLDG HLDGS LTD

Research House: DBS Vickers

Price Call: BUY

Target Price: 1.32

Market Compass

25 September 2013~ Good Morning Singapore!

Singapore Idea Snippets:

25 Sept 2013 ~ Good Morning Singapore! Central Execution Team - The Excellence of Execution This product is made available by your Central Execution Team, for you as TRs of OCBC Securities to help you with your business and therefore it is confidential and only for internal circulation. It is not intended for onward circulation to non-OSPL TRs, clients or any other third party in this or any other version. Neither is this intended to be relied upon as a sole basis for any recommendation. TRs must also consider their clients' investment objectives, financial position and needs when intending to make or making any recommendation. For the front desk, by the front desk. All feedback to make this a better product is welcome. Global Flash: While You Were Sleeping Source: Marketwatch Quote for the day : The iPod completely changed the way people approach music. - KARL LAGERFELD Singapore: The Day Ahead SINGAPORE DAYBOOK :Reit flotations shore up Q3 property investment sales. Third-quarter tally of more than $13b highest since Q3 2007 [SINGAPORE] Property investment sales - which refer to big-ticket transactions of at least $10 million - have crossed $13 billion this quarter, roughly double the previous quarter and the strongest showing since Q3 2007. This quarter's figure has been buoyed by three real estate investment trust flotations (involving nearly $5.7 billion in asset sales), two government land sale sites (at Telok Ayer Street and in Yishun totalling $2.35 billion to Frasers Centrepoint) and the $1.16 billion sale of Grand Park Orchard hotel (including Knightsbridge mall) to Bright Ruby Resources, controlled by a Du family from China. Industry observers are not counting on a repeat performance next quarter. Figures from Savills Singapore show that investment sales have risen to $13.4 billion from $6.4 billion in Q2 and $8.7 billion in Q3 last year. (Source: The Business Times) MARKET SCOOP Geo Energy units ink mining related deals Ley Choon bags 4 contracts worth S$30.6m this month Singapore casinos trump Macau with tourism aces Singapore industrial output seen edging up in Aug: poll Smaller pre-school operators to receive S$40m boost over 5 years NTU, 360ip launch S$5.6m centre to promote SME growth in S'pore (Source: The Business Times) UOB KAY HIAN says... STARHILL GLOBAL REIT | BUY | TP: S$0.93 Upgrade to BUY (from HOLD) with a marginally higher target price of S$0.93 (from S$0.92) Starhill is offering the highest yieldsfor a Singapore-centric retail REIT with a forward yield of 6.4%, which is 40-100bp above comparable retail S-REITs and is 60bp above the sector average yield of 5.8% P/B for Starhill is also the lowest amongst its retail S-REIT peers at 0.89, 20bp below the sector average of 1.09 Locking in long-term financing following the drawdown of S$422m 3-year and 5-year loans and ¥700b (S$88m) 3-year loans All-in-cost of debt for the new loans is a favourable 2.4%, compared with an average interest rate of 3.03% as at 2Q13 Following the refinancing, Starhill Global REIT (Starhill) will not have any refinancing requirements until 2015 Building sustainability for the long termas although the new loans will only result in marginal cost savings, due to the lower proportion of yen-denominated loans (11% of outstanding loans from 19%), the refinancing enables Starhill to extend its debt maturity (3.5 years from 1.2 years in 2Q13) and lock in the current low financing costs In addition, Starhill has also fixed or hedged 94% of its debt via interest rate swaps and caps, limiting cost upside The new loans are also unsecured, enabling Starhill to raise the proportion of unencumbered assets to 79% from 42% This, coupled with the credit rating upgrade by Standard and Poor's (to BBB+), will mitigate the impact of rising interest rates on Starhill's distributions NOMURA Securities says ... GENTING SINGAPORE | NEUTRAL | TP: S$1.52 Action: Upgrade to Neutral; Street expectations more realistic Following a 40% cut in street FY13F EBITDA estimates since 2012, we feel that our revised FY13/14F EBITDA estimates of S$1.26bn/1.4bn are a much more realistic assessment of Singapore's baseline gaming revenue potential, taking into account a volatile win % and seasonal fluctuations With Singapore tourist arrivals moderating to single digits (YTD arrivals up 8% y-y), and this being reflected in Sentosa traffic, we forecast a mid-high single digit growth in RWS's top-line We argue that our and consensus earnings have limited downside risks now, and this should support the share price at current levels We tweak our FY13F/14F EBITDA estimates by -7%/+5% to build in a weak performance in 1Q13F due to a lower win rate However, we now value GENS at mid-cycle, as we no longer see a reason for it to trade at a discount given limited earnings downside We raise GENS to Neutral, with a TP of S$1.52/share (5% upside) Valuation: Target 12.5x adj FY14F EV/EBITDA, historical average Following a transfer of coverage, we ascribe a 12.5x adj multiple to FY14F EBITDA to value GENS, which is its historical average This implies a 25% discount to Macau-listed names' average multiple Macau stocks have seen a re-rating driven by mass market volumes, which are unlikely to occur in Singapore, and are additionally supported by better yields, RoE Catalysts: Upside possible through overseas ventures (eg Japan) With Singapore's market maturing, upside in GENS's earnings is possible either through a sharp upswing in VIP volumes / win rate (difficult to forecast) or a deployment of its huge cash balance in overseas ventures, like Japan, where there are uncertainties on timing and competition DBS Securities says... YANGZIJIANG SHIPBUILDING | BUY | TP: S$1.32 Yangzijiang is hosting a yard visit on 25 Sept in conjunction with the launching ceremony of its first 10k TEU containership Launching is the most important stage of construction, marking the birth of a new ship All the blocks are mounted and joined, and the vessel should be ready to "float" at this stage The on-track construction progress of Yangzijiang's first large containership is a confidence booster The first batch of seven 10k TEU containership orders will likely yield better gross margins of 15-20% vs earlier expectation of low teens, in the light of favourable steel cost and forex as well as smooth execution As such, we are lifting FY14F shipbuilding gross margins by 2ppts to 18% We are also raising order win assumption for FY14 to US$2.5bn (from US$2bn), on the back of active shipbuilding enquiries and the sizeable US$2.87bn worth of options that could be exercised in the coming quarters Taking these into account, our FY14F net profit is raised by 6.3% to Rmb2.2 bn We have also introduced FY15 earnings and have incorporated property income from FY15 We have changed our valuation methodology from price to book, to SOTP, to better reflect valuation for the various segments of shipbuilding, investment and property While some investors have concerns regarding Yangzijiang's investment segment, it is a supplementary business for Yangzijiang and its weighting should fall as the shipbuilding segment recovers Bad debts have been minimal with proper evaluation processes and risk management procedures in place As one of the most cost efficient yards in China, Yangzijiang is the best proxy to the shipbuilding recovery

OSPL - Good Morning S'pore - Central Dealing Desk

Stock Name: Capitaland
Company Name: CAPITALAND LIMITED

Research House: UOB KayHian

Price Call: BUY

Target Price: 4.45

Stock Name: Starhill Gbl
Company Name: STARHILL GLOBAL REIT

Research House: OCBC

Price Call: BUY

Target Price: 0.95

Stock Name: Cambridge
Company Name: CAMBRIDGE INDUSTRIAL TRUST

Research House: DBS Vickers

Price Call: HOLD

Target Price: 0.78

Market Compass

26 July 2013~ Good Morning Singapore!

Singapore Idea Snippets:

26 July 2013~ Good Morning Singapore! Central Execution Team - The Excellence of Execution This product is made available by your Central Execution Team, for you as TRs of OCBC Securities to help you with your business and therefore it is confidential and only for internal circulation. It is not intended for onward circulation to non-OSPL TRs, clients or any other third party in this or any other version. Neither is this intended to be relied upon as a sole basis for any recommendation. TRs must also consider their clients' investment objectives, financial position and needs when intending to make or making any recommendation. For the front desk, by the front desk. All feedback to make this a better product is welcome. Global Flash: While You Were Sleeping Source: Marketwatch Quote for the day : Humor is perhaps a sense of intellectual perspective: an awareness that some things are really important, others not; and that the two kinds are most oddly jumbled in everyday affairs. - CHRISTOPHER MORLEY Singapore: The Day Ahead SINGAPORE DAYBOOK :CapitaLand rattles off a few blunt 'home truths' [SINGAPORE] In a candid assessment of the Singapore residential property market, CapitaLand yesterday warned of headwinds in the near term. Following the introduction of a 60 per cent cap on total debt servicing ratio that financial institutions must apply before issuing property loans, effective June 29, CapitaLand said in its latest financial results statement that "prices and sales volume of Singapore residential property are expected to moderate as the cumulative impact of the various property measures continue to be played out in the coming months". Analysts note that CapitaLand has been quite responsive to market changes and introduced discounts at its projects d'Leedon, Interlace and, most recently, Sky Habitat in Bishan. Referring to Sky Habitat, CapitaLand Residential Singapore CEO Wong Heang Fine said: "We are doing selective unit discounts - but not on a mass basis." (Source: The Business Times) MARKET SCOOP Advance SCT chairman removed as defendant, arbitration to resume Stamford Land Q1 net up 41.3% Q1 net profit up 11.9% for SATS SIA's Q1 boosted by Virgin sale and lower fuel costs OUE H-Trust debuts 0.6% above IP0 price AIMS AMP Reit's Q1 DPU unchanged at 2.5 cents Yangzijiangis first counter to trade RMB shares on SGX CapitaLand Q2 net profit slightly down on lower portfolio gains (Source: The Business Times) UOB KAY HIAN says... CAPITALAND | BUY | TP: S$4.45 CapitaLand reported 2Q13 net profit of S$383.1m bringing the 1H13 earnings to S$571.3m, up 10.1% yoy driven by strong revenue contribution from development projects in Singapore and China, as well as rental income from the shopping mall business Excluding the impact of portfolio gains of S$108.5m, revaluation gains of S$232m, S$10.5m in impairment charges and S$27.7m one-off loss booked in 1H13, the core 1H13 operating profit of S$269m is below our expectations accounting for 33.6% of our full year forecast of S$801.5m (36.5% of consensus forecast of S$736.7m) Strong residential sales of S$1.6b reported in Singapore (683 units of which lions share came from D'Leedon) which is more than a threefold increase over S$467m seen in 1H12 CapitaLand targets to launch Marine Point and Bishan St 14 in 2H13 In China, CapitaLand sold 1691 units with a sales value of S$640m in 1H13, 60% higher yoy The units sold were from The Metropolis in Kunshan, The Pinnacle and Paragon in Shanghai, The Loft in Chengdu and iPark under Raffles City Shenzhen Management guided for a cautious stance towards the housing market in Singapore in the near term with the recent government measures on Total Debt Servicing Ratio cap expected to have an impact on overall residential property sales However, management expects a sustainable demand for new homes over the long-term For CapitaMalls Asia Limited, the revenue growth in 1H13 was mainly contributed by Olinas Mall and The Star Vista CMA's key markets Singapore, China and Malaysia are expected to perform well in 2013, on the back of sustained tenant sales growth and meaningful contribution from the malls that opened in 2012 We have a BUY recommendation with a target price of S$4.45/share, pegged at a 15% discount to our RNAV of S$5.23/share OCBC Securities says ... STARHILL GLOBAL REIT | BUY | TP: S$0.95 Starhill Global REIT (SGREIT) announced 2Q13 NPI of S$39.1m and distributable income of S$26.7m, up 5.2% and 14.7% YoY, respectively While the number of units outstanding was enlarged post conversion of 152.7m convertible preferred units (CPUs) into 210.2m ordinary units, income to be distributed to CPU holders declined 88.2% YoY to S$0.3m As a result, distribution to unitholders was up 22.1% to S$25.6m (S$0.9m retained), while DPU was up 10.2% YoY to 1.19 S cents Together with 1Q DPU of 1.37 S cents, 1H13 DPU totaled 2.56 S cents, up 19.1% YoY This forms 52.1%/51.2% of our/consensus full-year DPU forecasts, well within expectations The positive performance was mainly due to strong contribution from its Singapore and Australia portfolios Both Wisma Atria (WA) and Ngee Ann City (NAC) benefited from higher occupancies and positive rental reversions (15.1-15.6% increase for office segment and WA retail leases committed from Jul 2012 to Jun 2013) In addition, NAC saw its NPI grow 9.8% YoY due to a 10.0% rent increase for Toshin master lease This led to a 6.9% YoY growth in Singapore portfolio's NPI Australia portfolio NPI also jumped 32.7% YoY as a result of incremental income from its recently acquired Plaza Arcade, despite a weaker AUD (down ~5%) This has more than offset the soft performance at the other overseas portfolios For 2Q, we note that SGREIT's Singapore portfolio contributed 63.7% of total revenue, largely unchanged from 66.3% in 1Q Overall occupancy also stayed stable at 99.6%, compared to 99.7% seen in previous quarter Looking ahead, management believes the new renewal rate (+6.7%) for Toshin lease, 7.2% rental uplift from the Malaysia master leases, and continued repositioning of WA will help to bolster SGREIT's income in 2H13 On its capital management front, SGREIT also expects its debt duration to improve from 1.2 years to 3.5 years and the percentage of debts fixed/hedged will increase from 81% to over 90%, having secured loan facilities to refinance all its debts due in 2013 We maintain BUY with unchanged fair value of S$0.95 on SGREIT DBS VICKERS Securities says... CAMBRIDGE REIT | HOLD | TP: S$0.78 Cambridge REIT (CREIT) reported a 14% and 13% y-o-y rise in revenues and net property income to S$24.6m and S$20.8m, respectively The better performances were largely due to the contribution from acquisitions and development projects, rental escalations, offset by loss of income from divestments Portfolio occupancy remained high at c.98% with a weighted lease expiry of 3.2 years Distributable income rose by 8% y-o-y to S$15.3m (which was largely a distribution of capital as the Manager was entitled to a performance fee of S$13.9m after a voluntary 50% waiver) DPU was 1.24Scts (+5% y-o-y) CREIT also reported net revaluation gains of S$31.9m, 3% higher compared to Dec 12 values CREIT's organic growth performance is likely to remain stable The Manager has leased close to 500,000 sqft of space in 1H13 with positive uplifts of 5-10% CREIT has a weighted average lease expiry of 2.4 years There is a further c4.0% of its income up for renewal for the rest of 2013, implying that earnings are likely to be fairly stable The Manager continues to execute on development projects, with an aim in optimising the value of its portfolio One such strategy is to maximize available GFA in selected properties - 3 Pioneer Sector 3 and 21B Senoko Loop - where CREIT will raise the plot ratios of these properties to 1.3x and 2.4x respectively, adding close to 384k additional GFA to the portfolio While the impact is not expected to be substantial, we remain positive on the ability of CREIT to extract value within its portfolio, which is likely to imply further growth in rentals and capital values for the properties, and thus having a positive impact on unit holders' distributions Maintain HOLD and TP S$0.78, given limited upside

SG: MARKET PULSE: Starhill Global, Cache, FCOT, CapitaLand, YZJ (25 Jul 2013)

Stock Name: Starhill Gbl
Company Name: STARHILL GLOBAL REIT

Research House: OCBC

Price Call: BUY

Target Price: 0.95

Stock Name: CACHE
Company Name: CACHE LOGISTICS TRUST

Research House: OCBC

Price Call: BUY

Target Price: 1.40

Stock Name: Frasers Comm
Company Name: FRASERS COMMERCIAL TRUST

Research House: OCBC

Price Call: BUY

Target Price: 1.60

Stock Name: Capitaland
Company Name: CAPITALAND LIMITED

Research House: OCBC

Price Call: BUY

Target Price: 3.77

MARKET PULSE: Starhill Global, Cache, FCOT, CapitaLand, YZJ

25 Jul 2013

KEY IDEA Starhill Global REIT: Poised for further upside Starhill Global REIT (SGREIT) announced 2Q13 DPU of 1.19 S cents, up 10.2% YoY. Together with 1Q DPU of 1.37 S cents, 1H13 DPU totaled 2.56 S cents, up 19.1% YoY. This forms 52.1%/51.2% of our/consensus full-year DPU forecasts, well within expectations. The positive performance was mainly due to strong contribution from its Singapore and Australia portfolios. For 2Q, we note that SGREIT's Singapore portfolio contributed 63.7% of total revenue, largely unchanged from 66.3% in 1Q. Overall occupancy also stayed stable at 99.6%, compared to 99.7% seen in previous quarter. Looking ahead, management believes the new renewal rate (+6.7%) for Toshin lease, 7.2% rental uplift from the Malaysia master leases, and continued repositioning of Wisma Atria will help to bolster SGREIT's income in 2H13. On its capital management front, SGREIT also expects its debt duration to improve from 1.2 years to 3.5 years and the percentage of its debts fixed/hedged to increase from 81% to over 90%, having secured loan facilities to refinance all its debts due in 2013. We maintain BUYwith unchanged fair value of S$0.95 on SGREIT. (Kevin Tan) MORE REPORTS Cache Logistics Trust: Solid 2Q13 scorecard Cache Logistics Trust (CACHE) turned in a firm set of 2Q13 results last evening. NPI grew 17.0% YoY to S$19.6m and distributable income increased 19.8% to S$16.6m. DPU for the quarter came in at 2.147 S cents, representing a rise of 8.4% YoY. This brings the 1H13 DPU to 4.381 S cents (+7.7% YoY), meeting 52.0%/50.9% of our/consensus FY13 DPU projections. As at 30 Jun, the overall portfolio occupancy was maintained at 100%, with a weighted average lease to expiry of 3.6 years. CACHE's aggregate leverage also held steady at 29.2% compared to 1Q. This, we note, is the second lowest gearing level among the industrial REITs listed in Singapore. While CACHE has kept mum on any likely acquisition asset, we judge that its robust financial position will put it in good stead for any attractive opportunities. Management also reiterated that there is no debt refinancing needs in the next two years, as its term loans will mature only in 2015 and 2016. In addition, 70% of its debts is hedged, thereby giving CACHE considerable certainty over its financing costs. We maintain BUY with unchanged fair value of S$1.40 on CACHE. (Kevin Tan) Frasers Commercial Trust: 28.8% jump in 3QFY13 DPU Frasers Commercial Trust (FCOT) reported 3QFY13 gross revenue of S$30.0m and NPI of S$23.1m, down 16.1% and 13.4% YoY respectively due to the divestments of KeyPoint and Japan properties. However, income available for distribution to unitholders rose by 31.2% to S$14.4m as a result of lower interest costs and savings in the Series A Convertible Perpetual Preferred Unit (CPPU) distribution post redemption of 319.7m CPPUs this year. This has led to a similar jump of 28.8% in the quarterly DPU to 2.19 S cents. For 9MFY13, DPU tallied 5.76 S cents (+16.6%), meeting 78.9% of our FY13 DPU forecast (consensus: 73.8%). As at 30 Jun, the portfolio occupancy remained strong at 98.1%, while weighted average lease to expiry was long at 4.6 years. FCOT also announced that it has completed the Precinct Master Plan and asset enhancement works at China Square Central, which should enhance portfolio and position FCOT for further growth in future. We will be speaking to management later and in the meanwhile, we maintain BUY on FCOT but put our S$1.60 fair value under review. (Kevin Tan) CapitaLand Limited: 2Q13 figures within expectations CapitaLand's 2Q13 PATMI decreased 0.7% YoY to S$383.1m. We judge this to be within expectations and 1H13 PATMI now cumulates to S$571.3m which makes up 65% of our full year forecast. 1H13 topline is S$1,844.6m, up 22.7% YoY mostly due to higher recognitions from residential projects in Singapore and China and stronger contributions from CMA and Ascott. Over 1H13, we saw 683 residential units sold in Singapore - up significantly YoY versus the 259 units sold in 1H12 - and Chinese residential sales also grew a healthy 58% YoY to 1,619 units in the first half of the year. The group reports that it foresees headwinds for the private residential market in Singapore over the near term due to recent curbs but remains positive about its businesses in China, which is underpinned by urbanization, growing affluence and increasing domestic consumption. Maintain BUY with our fair value estimate of S$3.77 under review.(Eli Lee) Yangzijiang Shipbuilding: First company on the SGX to trade in RMB The SGX has announced that Yangzijiang Shipbuilding (YZJ) will be the first company to have trading of its shares in Chinese Renminbi (RMB) on SGX's dual currency trading platform. The group's RMB-denominated shares will start trading on 5 Aug 2013. This move gives existing and potential investors the flexibility to buy and sell YZJ shares in yuan, gaining direct exposure to exchange rate fluctuations in the currency. We currently have a HOLD rating on YZJ with a fair value estimate of S$0.95, mainly due to the bleak outlook of the shipbuilding industry as well as uncertainties in China's credit and financing business.(Low Pei Han)

For more information on the above, visit www.ocbcresearch.comfor the detailed report.

NEWS HEADLINES - US equities retreated on Wednesday on mixed earnings and increasing borrowing costs. The DJIA fell from the prior day's record close. - MTQ's 1Q14 PATMI rose 38% to S$6.5m; revenue had climbed 146% to S$94.4m. - Hisaka Holdings has announced an MoU in relation to the proposed very substantial acquisition of Temasek Regal Capital Sdn Bhd. - Sysma Holdings has completed the purchase of a 60% equity stake in GCAP Properties. - Banyan Tree is issuing S$70m of 5.75% notes due 2018.

SG: Market Pulse: Starhill Global, Hyflux, Yoma (27 Jun 2013)

Stock Name: Starhill Gbl
Company Name: STARHILL GLOBAL REIT

Research House: OCBC

Price Call: BUY

Target Price: 0.95

Stock Name: Hyflux
Company Name: HYFLUX LTD

Research House: OCBC

Price Call: HOLD

Target Price: 1.30

Stock Name: Yoma
Company Name: YOMA STRATEGIC HOLDINGS LTD

Research House: OCBC

Price Call: HOLD

Target Price: 0.87

MARKET PULSE: Starhill Global, Hyflux, Yoma

27 Jun 2013

KEY IDEA Starhill Global REIT: Prospects remain bright Summary: Starhill Global REIT (SGREIT) announced that its convertible preferred unit (CPU) holders have notified the REIT manager of their intention to exercise their rights to convert a total of 152.7m CPUs into new units on 5 Jul. With the conversion, we estimate that the distribution to CPU holders will drop from an average of S$2.4m to just S$0.3m per quarter, leaving a larger distributable amount available to unitholders. However, as the unit base is expected to increase by 10.8% upon the conversion, the net impact is likely a marginal dilution of ~1.1% to pro forma FY12 DPU, according to management. We now factor in the impending CPU conversion into our forecasts. We also update our CAPM assumptions to incorporate the continued increase in risk-free rate. As a result, our fair value eases from S$1.00 to S$0.95. Nevertheless, we continue to like SGREIT for its strong growth potential, robust fundamentals and attractive valuations. Maintain BUY. (Kevin Tan) MORE REPORTS Hyflux: Value is starting to emerge Summary: Hyflux Ltd recently saw a massive correction in its share price, plunging nearly 13.1% from a high of S$1.37 on 10 Jun to a low of S$1.19 on 24 Jun; it was down 6.1% on 24 Jun itself, no doubt spooked by recent reports of credit tightening in the mainland. But these worries - while valid - are overwrought. We believe that Hyflux should still have access to funds from overseas, and this should put the company on a better footing against local Chinese companies when it comes to bidding for projects. Nevertheless, as the market appears to be taking a more "risk off" approach, we now use a lower 20x peg (versus 22x previously) against our FY13F EPS, which results in our fair value easing from S$1.44 to S$1.30. However, value is starting to emerge, especially closer to its recent S$1.19 low; hence we maintain our HOLD rating on the stock. (Carey Wong) Yoma Strategic Holdings: Telco license award possibly delayed Summary: Yoma has requested for a trading halt last night pending the expected award of two telecommunications licenses today by the Myanmar authorities. However, latest news reports that the parliament had on Wednesday voted to delay the award until a new telecommunications law governing the industry is passed. This is due to concerns that the "industry risked being monopolized" and it is yet unclear if a proposed new rule - that only foreign companies with a local JV partners would be granted licenses - would be adopted. Given these latest updates, we believe that the license award could possibly be delayed as the decision from the parliament is purported to override that of the Telecommunications Operator Tender Evaluation and Selection Committee, which is overseeing the tender process. Maintain HOLD with a fair value estimate of S$0.87. (Eli Lee)

For more information on the above, visit www.ocbcresearch.comfor the detailed report.

NEWS HEADLINES - Kevin Rudd returned as Australian PM yesterday, executing a stunning party room coup on Julia Gillard with less than three months out from a general election. - Tuan Sing Holdings has entered into a sale and purchase agreement with Robinson Point (Cayman) Limited to acquire Robinson Point for S$348.9m. - Keppel Reit has acquired a 50% stake in a freehold office building, 8 Exhibition Street in Australia, for A$160.2m (S$192.4m). - Sin Heng Heavy Machinery announced that it plans to raise about S$18.4m through a one-for-four rights issue priced at 16 cents apiece. - Mirach Energy is proposing to raise some S$18.1m in net proceeds from a rights issue of 152m new shares and another S$36m via a convertible loan. - Singapore's industrial production grew 2.1% YoY in May, above the market's expectations of just 0.1%, driven by a 22.8% jump in pharmaceutical output.

OSPL - Good Morning S'pore - Central Dealing Desk

Stock Name: Starhill Gbl
Company Name: STARHILL GLOBAL REIT

Research House: UOB KayHian

Price Call: BUY

Target Price: 1.06

Stock Name: NeraTel
Company Name: NERATELECOMMUNICATIONS LTD

Research House: OSK

Price Call: BUY

Target Price: 0.79

Market Compass

18 June 2013~ Good Morning Singapore!

Singapore Idea Snippets:

18 June 2013~ Good Morning Singapore! Central Execution Team - The Excellence of Execution This product is made available by your Central Execution Team, for you as TRs of OCBC Securities to help you with your business and therefore it is confidential and only for internal circulation. It is not intended for onward circulation to non-OSPL TRs, clients or any other third party in this or any other version. Neither is this intended to be relied upon as a sole basis for any recommendation. TRs must also consider their clients' investment objectives, financial position and needs when intending to make or making any recommendation. For the front desk, by the front desk. All feedback to make this a better product is welcome. Global Flash: While You Were Sleeping Source: Marketwatch Quote for the day : Any man who reads too much and uses his own brain too little falls into lazy habits of thinking. - ALBERT EINSTEIN Singapore: The Day Ahead SINGAPORE DAYBOOK:Asian markets relatively calm ahead of key FOMC meet. But volatility could return if Fed sends ambiguous signals about its QE policy, say analysts. ASIAN financial markets enjoyed a day of relative stability yesterday ahead of the critical meeting today and tomorrow of the US Federal Reserve Open Markets Committee (FOMC), which investors hope will calm turbulence caused by uncertainty over the future conduct of US monetary policy. A growing consensus that Fed chairman Ben Bernanke will signal at the meeting that it is too early yet to decide upon the timing of "tapering" off monetary easing - despite his recent hints that this could begin in coming months - brought some poise back to equity, bond and currency markets. In Tokyo, the Nikkei 225 stock average climbed back out of technical bear market territory by rising 2.7 per cent or 346.60 points to 13,033.12, while the yen sank back below the 95 to the dollar level and government bonds enjoyed a reprieve from volatility. Hong Kong's Hang Seng index, meanwhile, added 1.3 per cent to 21,251.17, while Australia's S&P/ASX 200 advanced 0.3 per cent to 4,905.90. South Korea's Kospi shed 0.1 per cent to 1,887.08. Benchmark indices in China, Singapore and Taiwan also rose while Thailand's SET fell. (Source: The Business Times) MARKET SCOOP Developers sold 1,455 private homes excluding ECs in May Eutelsat, KKR said to place bids for SingTel's Australia unit Yoma's Yangon land buy hits delay Govt to make more data available to public Govt releases five sites under GLS Singapore punishes 20 banks in benchmark rate review S'pore May non-oil exports fall 4.6% CosmoSteel explores Mynamar tie-up (Source: The Business Times) UOB KAY HIAN says... STARHILL GLOBAL REIT | BUY | TP: S$1.06 Starhill Global REIT (SGREIT) announced that its sponsors, YTL Hotels and Properties and YTL Corporation, will be converting 152.7m (88% of outstanding CPUs) of convertible preference units (CPUs) The CPUs were issued in Jun-2010 as part consideration for SGREIT's acquisition of Starhill Gallery and Lot 10 properties and offered a distribution yield of 5.65% p.a. The CPUs are convertible at S$0.7266 per unit, at a 30% premium to VWAP when issued, and a 17% discount to current share prices Following the conversion on 5 Jul 2013, the total number of units will increase by 210m (10.8%) to 2,153m units from 1,943m units while the number of CPUs will decrease 88% to 20.3m units from 173.1m units Net impact of the conversion, assuming it taken place on 1 Jan 2012, would be a 1.1% dilution of DPU in 2012 and a 10.3% drop in NAV to S$0.87 per unit The impact to DPU is substantially offset as the CPUs were offering a high distribution yield of 5.65%, while the substantial conversion removes a large equity overhang This is in-line with our projections as the CPUs were due to be converted between June 2013 and June 2017 We have a BUY recommendation on SGREIT with a target price of S$1.06, based on the dividend discount model (required rate of return: 6.5%, terminal growth: 2.0%) DMG OSK Securities says ... NERA TELECOMMUNICATIONS LTD | BUY | TP: S$0.79 NeraTel (BUY, SGD: 0.79) announced today that it has partnered with Juniper Networks, a leading network equipment provider worldwide, in delivering the software-defined network (SDN) solution in Southeast Asia In a nut shell, the SDN is a new generation of networking model which i) provide an open infrastructure for data centre and cloud networks (as opposed to the traditional network infrastructure) and ii) automate the infrastructure management, driving down operating costs for telecommunication and internet services providers The news bodes well with NeraTel's outlook, strengthening its position as a premium solution provider in the network equipment space (fending off competitors who focus on cost-competitiveness) With a 60-year brand name and track record, NeraTel is well positioned to tap on the robust Telco spending outlook. The counter remains the top pick for our Singapore tech coverage CIMB Securities says... STARHILL GLOBAL REIT | NEUTRAL | TP: S$0.93 Starhill has received notices from YTL Hotels & Properties and YTL Corporation, both under its sponsor, the YTL Group, that each intends to exercise its rights to convert in aggregate 153m convertible preferred units (CPUs, out of a total 173m issued in 2010) into new units of SGREIT on 5 July 2013, at a conversion price of S$0.73/unit This will raise the group's stake in SGREIT from 29% to 36% The CPUs were issued by SGREIT in June 2010 to fund the acquisition of Starhill Gallery and Lot 10 in Malaysia The conversion price of S$0.73 is 17% below the closing price of S$0.88 on 14 June Based on our estimates, the dilution from the conversion is approximately 1-3% for FY13-15 DPUs As a result of the enlarged share base, proforma NAV per unit will also drop by 10% post-CPU conversion to about S$0.87/unit We view this event as a marginal negative given the dilution and a lost opportunity of a potentially accretive redemption by SGREIT That said, dilution is fairly minor, with some marginal positives stemming from a higher stake to be held by the sponsor post-CPU conversion Our DDM-based target price drops marginally to S$0.93 (discount rate: 7.6%) We see potential re-rating catalysts in asset enhancement initiatives and accretive acquisitions We remain Neutral on SGREIT as we see positives from rental reversions largely priced in, with the stock trading at 1.0x proforma P/BV, above its 5-year historical average of 0.7x

OSPL - Good Morning S'pore - Central Dealing Desk

Stock Name: Starhill Gbl
Company Name: STARHILL GLOBAL REIT

Research House: UOB KayHian

Price Call: BUY

Target Price: 1.06

Stock Name: Capitaland
Company Name: CAPITALAND LIMITED

Research House: OCBC

Price Call: BUY

Target Price: 4.29

Stock Name: Ascendasreit
Company Name: ASCENDAS REAL ESTATE INV TRUST

Research House: UOB KayHian

Price Call: BUY

Target Price: 2.86

Market Compass

12 June 2013~ Good Morning Singapore!

Singapore Idea Snippets:

12 June 2013~ Good Morning Singapore! Central Execution Team - The Excellence of Execution This product is made available by your Central Execution Team, for you as TRs of OCBC Securities to help you with your business and therefore it is confidential and only for internal circulation. It is not intended for onward circulation to non-OSPL TRs, clients or any other third party in this or any other version. Neither is this intended to be relied upon as a sole basis for any recommendation. TRs must also consider their clients' investment objectives, financial position and needs when intending to make or making any recommendation. For the front desk, by the front desk. All feedback to make this a better product is welcome. Global Flash: While You Were Sleeping Source: Marketwatch Quote for the day : Life is 10 percent what you make it, and 90 percent how you take it. - IRVING BERLIN Singapore: The Day Ahead SINGAPORE DAYBOOK:DBS wants to buy entire stake in Danamon: chairman. A smaller stake will require a review of the economics of the deal, he says [SINGAPORE] Peter Seah, DBS Group Holdings chairman, yesterday told BT that the bank would still want to buy Temasek Holdings' entire stake in PT Bank Danamon Indonesia. A smaller stake would require a review of the economics of the deal, he said. "We entered into an agreement to buy Temasek's stake in Danamon. Having done that, we hope it'll get approval (from the Indonesian authorities)." Mr Seah's comments on the Danamon acquisition came in an interview with BT on Singapore's evolving banking landscape. "Indonesia is an attractive market and fits very well into our Asian strategy," he said (Source: The Business Times) MARKET SCOOP Medi-FlexQ3 profit jumps to RM5.1 million Low Keng Huat's units transfer retail units at Paya Lebar Sq Indonesian state-owned servicing firm plans year-end IPO San Miguel sells control of banking unit to Malaysia's CIMB Petronasto spend US$5b on Canadian LNG project -exec UEproposes 1-for-1 rights issue after WBL takeover GuocoLeisurelaunches global hotel management company (Source: The Business Times) UOB KAY HIAN says... STARHILL GLOBAL REIT | BUY | TP: S$1.06 Starhill Global REIT (SGREIT) has announced that the Toshin master lease has been renewed at a rate which is 6.7% higher than the prevailing rate This is based on the average of three market valuations by independent market valuers The renewal rent will be valid for a period of 12 years from 8 June 2013, with a provision for a rental review every three years during the renewal period We estimate that the rental uplift will provide a 1% and 2% accretion to 2013 DPU and 2014 DPU respectively We have a BUY recommendation on SGREIT with a target price of S$1.06, based on the dividend discount model (required rate of return: 6.5%, terminal growth: 2.0%) OCBC Securities says ... CAPITALAND LIMITED | BUY | TP: S$4.29 CapitaLand (CAPL) announced yesterday that it has secured a contract to manage a serviced residence in Alabang, a major business district in Metro Manila, Philippines The 150-unit Somerset Alabang Manila is expected to open in 2017 and will be The Ascott Ltd's (Ascott) eighth property in the Philippines Over the last month, we note the Ascott Limited secured two management contracts in Wuxi, China (the 134-unit Ascott Central Wuxi and 169-unit Somerset Wuxi), one contract in Riyadh, Saudi Arabia (the 230 unit Ascott Olaya Riyadh) and two in Jeddah, Saudi Arabia (the 166-unit Citadines Tahlia Jeddah and 136-unit Citadines Al Salamah Jeddah) This carries on a track record of robust growth for CAPL's serviced residence business where the number of owned/managed units has grown at a CAGR of 13% since 2000 Ascott is now the world's largest international serviced residence owner-operator with 31,770 units in 78 cities as at end 1Q13 Over 1Q13, overall portfolio REVPAU remained stable at S$109, with China, Europe and the Gulf region and India up 4%, 2% and 2% YoY, respectively We see the continued growth of CAPL's serviced residence business extending its competitive edge in terms of scale and branding With about S$0.9b of assets under development (on an effective stake basis), Ascott enjoys a good pipeline for capital recycling and growing the Ascott REIT ahead The group recently divested three Chinese properties and 11 Japan properties to the Reit with a gain of S$15m and the transaction is expected to complete in 2Q13 We continue to favor CapitaLand for its diversified real estate portfolio across asset classes, its strong balance sheet and renewed management focus on improving shareholder ROE Maintain BUY with an unchanged fair value estimate of S$4.29 (20% discount to RNAV) UOB KAY HIAN says... ASCENDAS REIT | BUY | TP: S$2.86 Upgrade to BUY (from HOLD) with an unchanged target price of S$2.86, based on Dividend Discount Model (required rate of return: 6.8%, terminal growth: 2.0%) AREIT share price has seen the sharpest share price correction of 19% amongst the S-REITs under coverage vs an 11% correction for the sector Valuations are looking attractive with a forward yield of 6.7% relative to large-cap industrial peers (MINT: 7.0%, MLT:6.3%). P/B of 1.2x for AREIT is lower than the 1.3 for large-cap industrial REITs Growth fundamentals remain intact with DPU expected to grow 4% in FY14 and 8% in Y15 on the back of positive rental reversions, completion of asset enhancements and the completion of new developments Business park rentals are expected to remain resilient in light of the bottoming of office rentals in 2013 Gearing at 28.3% in 1Q13, its lowest point in over four years as AREIT issued 160m new units to raise S$406m (S$2.54 per unit) in a March private placement Even after factoring in committed investments, gearing is expected to rise only to 30.4%, giving AREIT headroom of S$1.9b for acquisitions before reaching 45% gearing The conservative gearing structure, which is one of the lowest amongst the S-REITs, also means that the impact of a rise in interest rates will be muted AREIT has taken advantage of the low interest rate environment to extend its debt maturity to 3.9 years, which is 18% longer than its average maturity of 3.3 years between 2009 and 2011 Over 50% of AREIT's debt is maturing in three years or later, with debt tenure extended to as long as 2024 (11 years) All-in interest costs have fallen only 11% from the 2009-11 average of 3.7% to 3.4% in 1Q13 as AREIT has opted to extend maturities in-lieu of lower financing costs A gradual rise in interest rates can be mitigated by shortening debt tenure

SG: MARKET PULSE: Starhill, Tiger, Midas (12 Jun 2013)

Stock Name: Starhill Gbl
Company Name: STARHILL GLOBAL REIT

Research House: OCBC

Price Call: BUY

Target Price: 1.00

Stock Name: TigerAir
Company Name: TIGER AIRWAYS HOLDINGS LIMITED

Research House: OCBC

Price Call: BUY

Target Price: 0.79

Stock Name: MIDAS
Company Name: MIDAS HLDGS LIMITED

Research House: OCBC

Price Call: BUY

Target Price: 0.54

MARKET PULSE: Starhill, Tiger, Midas

12 Jun 2013

KEY IDEA Starhill Global REIT: Another positive development Summary: Starhill Global REIT (SGREIT) announced that the rent review for the Toshin master lease has been concluded, and that a renewal rent at 6.7% higher than the prevailing rate has been secured. This is consistent with our 29 Apr report that SGREIT may again benefit from rental upside following the completion of the review process. We now factor in the increased rents in our forecasts but lower our fair value marginally to S$1.00 on higher risk-free rate (S$1.05 previously). However, we continue to like SGREIT for its growth potential, strong financial position and compelling valuations. For FY13, SGREIT looks set to gain from continued strength from its Singapore portfolio, incremental income from its newly-acquired Plaza Arcade and a 7.2% rental escalation from its Malaysia master leases in Jun. We maintain BUY on SGREIT. Key risks include weaker JPY/AUD and negative impact from a potential CPU conversion. (Kevin Tan) MORE REPORTS Tiger Airways: Time for a tiger Summary: In light of its more than 6% price correction, we are reiterating our BUY rating on Tiger Airways (TGR) with an unchanged fair value estimate of S$0.79 as we believe prospects remain positive for the counter. Its recent May operating statistics revealed its eighth consecutive month of passenger traffic growth for TGR SG, and passenger load factors during the period have also remained fairly resilient, which demonstrates its effective capacity management. In addition, we are hopeful for a better showing from its associate airlines given the propensity for travel in the coming months for Indonesia and the Philippines. On a broader scale, the industry dynamics, namely growth in the Asia-Pacific region, remains conducive for budget carriers as consumers become more affluent and appetite for air travel increases. (Lim Siyi)

Midas Holdings: JV NPRT secures CNY1.26b metro contract Summary: Midas Holdings (Midas) announced that its 32.5%-owned JV Nanjing SR Puzhen Rail Transport (NPRT) has clinched a CNY1.26b metro contract. This is for the supply of 33 train sets (or 198 train cars) for the Shenzhen Metro Line 3 project. However, delivery is scheduled only from 2015 to 2016. Given that this is the third contract secured by NPRT in two weeks, we believe this highlights the growing momentum of China's metro industry. In our view, this may also lead to future contract wins for Midas given that it is a supplier of aluminium extrusion profiles for NPRT. Maintain BUY on Midas, with an unchanged fair value estimate of S$0.54, pegged at 1.1x FY13F P/B. (Wong Teck Ching Andy) For more information on the above, visit www.ocbcresearch.comfor the detailed report.

NEWS HEADLINES - US stocks fell, sending the S&P 500 Index lower for a second day, after Bank of Japan Governor Haruhiko Kuroda said he sees no need to expand monetary stimulus immediately. - DBS would still want to buy Temasek's entire stake in Danamon, Business Times reports, citing an interview with Peter Seah, chairman of DBS Group Holdings Ltd. - Aussino expects that it will not be able to exit the SGX watch list by the 3 Sep deadline and intends to apply to SGX for extension of time to apply for removal from watch list. - T T J Holdings wins new contracts for structural steelworks and civil defence shelter doors in Singapore and Malaysia, bringing its order book to S$164m as at 11 Jun. - Tsit Wing's Chairman and CEO Peter Wong seeks to privatize the company and has acquired an aggregate of 20m ordinary shares at a price of $0.3075 each, valuing it at S$65.5m - Del Monte Pacific says shareholder Nutriasia Pacific to enter a placement agreement for the sale of 150m shares of the Company which will be listed and traded on the PSE, marking first dual listing between the SGX and the PSE.

SG: MARKET PULSE: S-REITs, Nam Cheong (4 Jun 2013)

Stock Name: Starhill Gbl
Company Name: STARHILL GLOBAL REIT

Research House: OCBC

Price Call: BUY

Target Price: 1.05

Stock Name: CapitaComm
Company Name: CAPITACOMMERCIAL TRUST

Research House: OCBC

Price Call: BUY

Target Price: 1.80

Stock Name: Fortune Reit HK$
Company Name: FORTUNE REAL ESTATE INV TRUST

Research House: OCBC

Price Call: BUY

Target Price: 8.64

Stock Name: Nam Cheong
Company Name: NAM CHEONG LIMITED

Research House: OCBC

Price Call: BUY

Target Price: 0.35

MARKET PULSE: S-REITs, Nam Cheong

4 Jun 2013

KEY IDEA Singapore REITs: Capitalize on over-reaction We see two key factors driving the S-REITs price correction over the last two weeks. First, increased expectations that the Federal Reserve could taper its bond purchases as early as 2H13; and secondly, opportunistic profit-taking on the back of a strong performance over 2012-13. At this juncture, however, we see the selling to be overdone. In our view, the odds of the Fed tapering bond purchases in 2H13 are roughly 50-50 and we see fundamental valuations for the S-REITs sector (370bp against the 10Y government bonds) to be undemanding currently. In addition, S-REITs sector would likely continue to deliver, in 2013, firm earnings from asset enhancement initiatives/development projects, yield-accretive acquisitions and active leasing efforts. Maintain our OVERWEIGHT rating on the S-REITs sector. Starhill Global REIT [BUY, S$1.05 FV] is our top pick in the sector due to its growth potential, strong fundamentals and compelling valuations. We also like CapitaCommercial Trust [BUY, S$1.80 FV] and Fortune REIT [BUY, HK$8.64 FV] for the quality of their portfolio assets, positive rental reversion profiles and low gearing. (S-REITs Team) MORE REPORTS Nam Cheong: Ride the upcycle! Nam Cheong Limited recently announced that its Executive Director, Mr. Leong Seng Keat, has been re-designated as the CEO. Mr. Leong, also the son-in-law of ex-CEO Datuk Tiong Su Kouk, has been with the group since 2005. We expect the leadership transition to be smooth. Meanwhile, we continue to like Nam Cheong for its market leadership in the increasingly active Malaysia oil & gas industry. Having seen a healthy pick-up in order wins, Nam Cheong recently expanded its shipbuilding programme to 28 vessels for FY14F (FY13: 19 vessels). Its large order-book of MYR1.3b, for 26 vessels delivered over FY13-15F, helps to mitigate its risk by providing a base level of earnings. Maintain BUY with a higher FV of S$0.35 (previously S$0.30). (Chia Jiunyang)

For more information on the above, visit www.ocbcresearch.comfor the detailed report.

NEWS HEADLINES - Datapluse Technology posted a 23.2% increase in net profit to S$2.19m for its 3QFY13 ended 30 Apr. - NH Ceramics entered into a purchase agreement to buy BlackGold Asia Resources Pte Ltd and BlackGold Energy Limited for US$150m. The two BlackGold firms control about 53,000 hectares of coal concessions in Indonesia. - Asian Micro Holdings is planning to acquire Oxley Global Limited in a proposed RTO deal. - Halcyon Agri announced that it would acquire Malaysian rubber processor Chip Lam Seng for RM63m (S$25.7m). - According to the latest purchasing managers' index, Singapore's industrial activity grew at a faster pace in May, also signalling a fourth consecutive month of growth for the electronics sector.

SG: MARKET PULSE: S-REIT, Bumi Armada (22 May 2013)

Stock Name: CapitaComm
Company Name: CAPITACOMMERCIAL TRUST

Research House: OCBC

Price Call: BUY

Target Price: 1.80

Stock Name: Fortune Reit HK$
Company Name: FORTUNE REAL ESTATE INV TRUST

Research House: OCBC

Price Call: BUY

Target Price: 8.64

Stock Name: Starhill Gbl
Company Name: STARHILL GLOBAL REIT

Research House: OCBC

Price Call: BUY

Target Price: 1.05

MARKET PULSE: S-REIT, Bumi Armada

22 May 2013

KEY IDEA Singapore REITs: The burgeoning market In our latest assessment of the S-REITs sector, we continue to see familiar trends. REIT managers have generally maintained firm growth in their trusts' rental income, on the back of contributions from past investments and improved operational performance. For 2013, we are maintaining our view that S-REITs are likely to continue to deliver firm performance. Nevertheless, the S-REIT index has been enjoying a good run-up, raking up 36.7% gain in 2012 and another 12.7% increase YTD. Given that the S-REITs are now trading at a 24% premium to book value on average, we feel that it is prudent to be selective on S-REITs. We continue to prefer S-REITs with good growth potential, strong financial position and compelling valuations. In this respect, we continue to pick CapitaCommercial Trust [BUY, S$1.80 FV], Fortune REIT [BUY, HK$8.64 FV] and Starhill Global REIT [BUY, S$1.05 FV] as our preferred BUYs. Reiterate our OVERWEIGHTview on the broader S-REITs sector. (S-REITs Team) MORE REPORTS Bumi Armada Berhad: A good start to FY13F Bumi Armada Berhad's 1Q revenue jumped 46% YoY to MYR489m and net profit to shareholders increased by 22% YoY to MYR110m. The results were roughly in-line with ours and the consensus' estimates. Segment results were mixed. Although the FPSO, OSV and T&I segments had YoY increases in revenue, only FPSO and OSV showed segment profit improvements. The OFS segment reported no activity for 1Q13. The group also benefited from disposal gain of a subsidiary of MYR9.4m, write-back of doubtful debt of MYR2.0m and a net foreign exchange gain of MYR3.0m. We tweaked our models slightly to reflect 1Q13 results and roll forward our estimates to FY13/14. Accordingly, our fair value increases slightly to MYR3.56 (previously MYR3.74) on 21x PER. Maintain HOLD. (Chia Jiunyang)

For more information on the above, visit www.ocbcresearch.comfor the detailed report.

NEWS HEADLINES - US stocks closed higher on Tuesday after a strong earnings report from Home Depot and also due to market anticipation of Wednesday's testimony by Ben Bernanke in Congress. - Boustead Singapore's FY13 PATMI rose 46% YoY on the back of a 26% increase in revenue YoY. It announced a final dividend of 3 cents and a special dividend of 2 cents. - RELIGARE Health Trust (RHT) registered DPU of 3.55 S cents for the period spanning 19 Oct 2012 to 31 Mar 2013, missing its projected DPU of 3.61 S cents. - The Asian prime brokerage unit of Credit Suisse has replaced Morgan Stanley as the second largest firm servicing the region's US$148 billion hedge funds industry, a survey shows. - Fashion group Giorgio Armani's sales revenue rose over €2.0b (US$2.6b) in 2012, a 16% rise YoY. It saw a 11% jump in sales in crisis-hit Europe. - British luxury group Burberry posted a 14% rise in full-year pretax profit but forecasts declining profit in 1H13 due to reduction in wholesale markets in favor of retail markets.

OSPL - Good Morning S'pore - Central Dealing Desk

Stock Name: Capitaland
Company Name: CAPITALAND LIMITED

Research House: UBS

Price Call: BUY

Target Price: 4.46

Stock Name: Starhill Gbl
Company Name: STARHILL GLOBAL REIT

Research House: UBS

Price Call: BUY

Target Price: 1.03

Stock Name: Yangzijiang
Company Name: YANGZIJIANG SHIPBLDG HLDGS LTD

Research House: DBS Vickers

Price Call: HOLD

Target Price: 1.02

Market Compass

30 April 2013~ Good Morning Singapore!

Singapore Idea Snippets:

30 April 2013~ Good Morning Singapore! Central Execution Team - The Excellence of Execution This product is made available by your Central Execution Team, for you as TRs of OCBC Securities to help you with your business and therefore it is confidential and only for internal circulation. It is not intended for onward circulation to non-OSPL TRs, clients or any other third party in this or any other version. Neither is this intended to be relied upon as a sole basis for any recommendation. TRs must also consider their clients' investment objectives, financial position and needs when intending to make or making any recommendation. For the front desk, by the front desk. All feedback to make this a better product is welcome. Global Flash: While You Were Sleeping Source: Marketwatch Quote for the day : Wisdom is not wisdom when it is derived from books alone. - HORACE Singapore: The Day Ahead SINGAPORE DAYBOOK:Reit IPOs set to take the market by storm. All signs suggest that it's going to be a record year with several promising offerings [SINGAPORE] The stars have aligned this year for a record-breaking initial public offering market for real estate investment trusts (Reits) and business trusts. But quality will be key. "There will be deals that are close to a billion, and potentially more as well. This is a healthy trend for the market," Credit Suisse Asia Pacific head of investment banking Helman Sitohang told The Business Times. The keen interest in the IPOs of Reits follows a successful flotation by Mapletree Greater China Commercial Trust (MGCCT) on March 7, which raised over S$1.6 billion amid strong demand from institutional investors. The stock, which was almost 30 times subscribed, has risen 20 per cent above its IPO price of 93 cents. Since then, other firms such as Overseas Union Enterprise (OUE) and Singapore Press Holdings (SPH) have also indicated plans for the listing of Reits. MARKET SCOOP OCBC'sQ1 net profit down 16% at S$696m SMRT'sQ4 slips into red with S$11.9M loss, slashes dividend Fragrance Group Q1 profit falls 20.2% Wheelock Properties post S$105.3m Q1 profit A-HTrust posts DPU of 1.68 cents in Q4 Singapore GIC to sell Glencore bonds, to buy shares UBS SECURITIES says... CAPITALAND LTD | BUY | TP: S$4.46 Apart from reduced segmental visibility as a result of the streamlined business units, it was difficult to fault CapitaLand's Q113 results with PATMI of S$188.2m, +41.2% YoY Singapore and China residential were key contributors while divestment gains from a Beijing site provided a S$47.5m boost We expect China earnings to contribute more meaningfully in H213 as the group hands over 2,800 units to buyers (versus 230 units in Q113) Singapore home sales displayed strong take-up with 544 units sold in Q113, mainly from d'Leedon Achieved sales of S$1.3bn for the quarter is encouraging and similar to that recorded for the entire 2012 China sales was also strong with 955 units sold and the challenge would be maintaining the momentum through H213 given policy headwinds We think major strategic initiatives, capital management and good acquisitions will help narrow the RNAV discount The Australand review has been ongoing for over 2 months and a favourable outcome soon would be a rerating catalyst, in our view Our price target is based on 0.9x RNAV UOB KAY HIAN says... STARHILL GLOBAL REIT | BUY | TP: S$1.03 Starhill Global REIT (SGREIT) reported a 1Q13 distributable income of S$26.6m (+28.0% yoy, +20.9%qoq) and a DPU of 1.18cents (10.3% yoy, +4.4% qoq) Revenues up on Wisma AEI and strong Singapore portfolio performance Positive resolution of Toshin rent review resulted in a 10% upward revision in rentals for the term from Jun-2011 to Jun-2013, while rental arrears of S$3.8m (S0.19c per unit) are included in 1Q13 distributions No debt due for refinancing until 2015 after SGREIT successfully secured JPY 7b (S$100m) and S$600m unsecured 3-year and 5-year loan facilities to refinance S$513m debt maturing in September and December 2013 Portfolio occupancy up 30bps to 99.7%, supported by full occupancies in Singapore retail and offices We anticipate further acquisitions, offset against divestments in Japan as SGREIT embarks on its next stage of growth Debt headroom of S$450m for acquisitions from current gearing of 30.5% assuming a target gearing of 40% Target price of S$1.03 based on DDM (required rate of return: 6.5%, terminal growth: 2.0%) DBS VICKERS Securities says... YANGZIJIANG SHIPBUILDING HOLDINGS | HOLD | TP: S$1.02 Yangzijiang's 1Q13 net profit fell 30% y-o-y to Rmb717m on the back of slower shipbuilding activities and a higher tax rate Results came in below our above consensus estimate of Rmb750-800m due to lower revenue recognition Yangzijiang terminated a 2500-TEU container contract (secured pre-GFC), whose construction was almost completed, bringing the total cancellation to 13 vessels On a positive note, the gross margin inched up 1.8ppt q-o-q to 25.9%, thanks to softer raw material prices, particularly steel Recent yen depreciation of 20% wiped out the cost advantage of Chinese yards over Japanese peers While Japanese yards are relatively full till 2015, we reckon this will intensify the competition in the dry bulk segment going into 2014 We have brought FY14 order win assumptions down from US$3bn to US$2bn We have also tweaked our orderbook recognition schedule and margin assumptions, resulting in an earnings cut of 8.2%/0.2% for FY13/14 Our TP is reduced to S$1.02, based on 1.1x revised NBV, which is fair against the lower ROE of 9 % by FY14